Clear Eyed Capitalist

Archive for February, 2008

For Christmas my Mother gave me an interesting book of women’s literary criticism. I flipped through somewhat at random and found fascinating reading about the lives and writings of both Margaret Mitchell (author of Gone with the Wind, published in 1936) and Zora Neale Hurston (who wrote Their Eyes were Watching God, published in 1937.) Both critiques referenced Uncle Tom’s Cabin, by Harriet Beecher Stowe. From those, I discovered that Uncle Tom’s Cabin was the bestselling book of the 19th Century after the Bible. And yet, as I finish my 2nd graduate degree, I have never read it, it has never been on any suggested reading list of mine, but I certainly have heard many references to it, and I am of course acquainted with the use of the phrase “Uncle Tom” as an insult. It seemed time to fill this gap in my education.

The Seattle Public Library has The Annotated Uncle Tom’s Cabin, annotations by Henry Louis Gates, Jr, and Hollis Robbins. At times, the annotations get a little tedious, for example when they note that such and such behavior or phrase would “be racist to any modern reader.” Yes, thank you, I can see that it is, I’m sorry you were worried I might not. Sometimes the annotations are unwelcome foreshadowing when they say things like “this is the first indication that character such-and-such is going to die.” What? It wasn’t obvious to me! I didn’t want to know that! But overall the annotations are very valuable, particularly for those of us not well versed in quoting scripture. Many of the characters, particularly Tom himself, quote scripture, and the annotations help the reader along in knowing what the next, unquoted but clearly implied, line of scripture would be, or illuminating the larger biblical story that is being referenced for its parallels to the current situation.

The book was written to incite abolitionist passion in the heart of every legally white American, particularly women who comprised the bulk of the novel-reading public. Prior to writing for the anti-slavery National Era newspaper (where Uncle Tom’s Cabin was originally published as a serial), Stowe wrote for Godey’s Lady’s Book. The book is alternately gripping, melodramatic, and a bit preachy, as one might expect from a novel with a political aim. During one particularly long character monologue I found myself briefly reminded of Robert Heinlein. Supposedly when Abraham Lincoln welcomed Harriet Stowe to the White House for a visit in 1862 he said “So you’re the little woman who wrote the book that started this great war”!

Published in 1852 Uncle Tom’s Cabin sold 300,000 copies in the US in its first year, 2 million world-wide in its first two years and was translated into 37 languages. In more than one debate between characters, Stowe draws parallels between capitalists/laborers and slaveholders & slaves. This perhaps led to the book’s popularity in countries like Russia, where even Tolstoy read it. Harriet Beecher Stowe’s Uncle Tom is a Christian martyr – hardworking, positive attitude and obedient – until ordered to do something more actively immoral than simply make the best of his role in the system of slavery, at which point he is clear that while his human master may own his body & its labors, God owns his soul and is to whom he is ultimately accountable. After two such occasions, he is whipped near to death, at which point he forgives his tormentors, has his wounds washed by caring supporters and at last he rests in a shed for two days and dies on the 3rd. Even I can recognize that biblical reference to the death of Christ. Tom of the book is no “Uncle Tom”.

So how did this character’s name become synonymous with sellout? It seems worth some pondering to me that Uncle Tom seems to have “sold out” by being co-opted. My first clue was a picture caption explaining that “By the turn of the twentieth century, Uncle Tom had become such an icon that he even appeared on whiskey bottles, like this one from the United Distilling Company of Cincinnati.” Seeking validation that this was the source of the sell-out, I did a little websurfing and discovered The Jim Crow Museum of Racist Memorabilia.

The “why” of the museum is long, involved, and worth reading, and I will pull this excerpt: “The mission of the Jim Crow Museum is straightforward: use items of intolerance to teach tolerance. We examine the historical patterns of race relations and the origins and consequences of racist depictions. The aim is to engage visitors in open and honest dialogues about this country’s racial history. We are not afraid to talk about race and racism; we are afraid not to.” It is Dr. David Pilgrim’s thorough writing on The Tom Caricature that explains that the many derivative works, significantly stage performances and later film, quickly degraded Uncle Tom into variations of weak, old, passive, happy, childlike servants. These are the Uncle Toms that made it to the sixties and became the source of intra-racial taunts. Dr. Pilgrim breaks down some of the usage and documents examples. He also has some interesting analysis of “Tom” roles in films over the decades and their evolution.

The book still fresh in my mind, I went to see The Waters of Babylon at the Seattle Repertory Theatre. At one point the Cuban character, Arturo, tells the legend of the death of Chief Hatuey, leader of the indigenous peoples of Cuba. To my astonishment, it nearly mirrors the story of Prue from Uncle Tom’s Cabin. There’s a version of Chief Hatuey’s death here. Another webpage traces the story to the “History of the Indies” written by Father Bartolomé de las Casas. Researching him leads me to the following :

“Historia apologética de las Indias”, for instance, has been only partly printed in the “Documentos para la Historia de España” (Madrid, 1876). The “Historia de las Indias”, the manuscript of which he completed in 1561, appeared in the same collection (1875 and 1876). His best-known work is the “Brevísima Relacion de la Destruycion de las Indias” (Seville, 1552). There are at least five Spanish editions of it. It circulated very quickly outside of Spain and in a number of European languages.

Fascinating. It makes sense to me that American abolitionists would have familiarized themselves with prior writings on the subject. So did Harriet Beecher Stowe copy the story from Father Bartolomé’s 1552 publication, or did the 1875 editors use Prue’s story from Uncle Tom to embellish the story of Chief Hatuey? Only going to the source will tell, but either way, anti-oppression movements have deep global roots.

I’ve been thinking of calling my collection of activities “full spectrum capital” (but the domain name is already camped on). Good Capital and Tim Freundlich were really key inspirations for me in their emphasis that it’s a continuum between philanthropy and investing, not buckets. The Heron Foundation also looks at their activities this way. I think it was in a break time discussion at SRI in the Rockies that someone suggested that one could regard a charitable gift simply as an investment with a -100% return. On that scale, a community investment note at 3% is meaningful.

Community Economic Development appeals to me because I’m attached to measurable results, and managing my foundation has at times been a struggle for me. I believe in accountability – down to how I spend my own personal time, I see how a lack of accountability leads to a lack of focus. Tim talks about how doing investing with non-profits instead of just gifting can give them an accountability that can be helpful. With my grant making, I’ve been trying to figure out what appropriate accountability is. One limitation is that I have to invest some of myself and my time to hold someone accountable, and there’s been a limit to that. A second challenge is trying to figure out how to be compassionate but still have some kind of standards.

I found an example in coffee growing. In the December 2007 issue of Tea & Coffee, there’s an article about work illycaffé is doing in Brazil. They’re doing it outside the Fair Trade system so it’s not exactly Fair Trade but it’s similar. Most people have only a vague idea that Fair Trade means workers get fair wages. It’s actually a complicated setup where specific Fair Trade price mark-ups are paid into specific funds that are then allocated by worker cooperatives. It’s also more than that – Fair Trade means working to help supplier-partners develop their own businesses, growing capacity and quality. What illycaffé is doing mirrors that.

The key components of what they’re doing are: 1) they have a clear standard of success – they are able to set a quality bar for coffee and measure whether or not a bag of coffee meets that bar. 2) there’s a clear reward for meeting that standard – they will buy at a premium every bag of coffee that meets their standard. 3) The provide opportunities for local farmers to learn how to meet their standard, via the illy University of Coffee and the illy Coffee Club, which teach management, environmental stewardship and technical training. Finally, They achieve visibility for these programs via an annual competition (Prêmio Brasil De Qualidade Do Café Para Espresso) where the winners receive prizes and illy gets preferential rights to buy the coffees submitted. Another nice summary of their work is here.

This to me seems like an excellent model – it establishes a well-understood, transparent system that the farmers can choose to participate in or not. Should farmers choose to participate at least some of the costs and rewards are clear, and a path to successful participation is provided. This is community economic development – here’s what success looks like, here are the tools, though in the US we tend to fall down on the “and here’s some(ideally free) help in understanding and using the tools” for true accessibility. That first step in the ladder is what Washington CASH provides locally.

The whole chain is what I would like to provide with my foundation, but it takes a well resourced leader to set all that up and manage it, and I have to admit The Massena Foundation is not that. Larger organizations, and particularly corporations like illy, DO have that kind of capacity, which leads me to believe that this kind of work is what corporate philanthropy should be. At the Corporation 20/20 conference last November in Boston, one of the speakers focused on the need to get corporate money out of politics, and for him also out of communities. It’s too easy with their relatively more significant resources for corporations to drive community decision-making. I thought that was interesting and I agree there’s a fuzzy line between corporate grant-making and marketing. But in Community Economic Development – large, stable, well organized corporations have a completely unique value to offer – access to markets and access to well-developed systems and training. Sharing that access would be worth more than any dollar grant they could make.

We read a series of mini-case-studies (UVA-ENT-0100) put together by Andrea Larson of The Darden School at UVA, guest professor at BGI this quarter. As I read through the cases a few themes emerged for me: First, in product reformulation, supply chain collaboration is key. Several cases are about premium products standing out in commodity categories. Branding matters, and creating a technical metabolism (wherein materials are truly recycled to become new of what they were old, instead of being downcycled to a different, less recyclable product) is key to true sustainability. Another theme that emerged is that goal setting is everything – if you believe that it’s not possible to be both cost efficient and green then you won’t get there – you have to set it as a goal. Finally, when working to be green – don’t just think about the product, think about the whole product lifecycle.

Supply Chain collaboration is key – several of the cases talked about the need to work with all members of the supply chain to design a new product. Climatex Fabric was an example of a company needing to find mill partners and yarn twisters that would work with a new process. NatureWorks PLA plastics a product that is challenged by as-yet not having deep enough supply chain relationships and control to allow it to ensure GMO-free product. Without control of the supply chain, they have limited control of the product. In the Nike case, they are described as essentially a “complex global supply chain” management company. To protect their brand, they had to develop “a new dimension to supply chain management.” Not only are they setting standards for their suppliers to meet, they’re supporting NGOs to develop the organic cotton industry – investing to create supply chain partners for the future.

Standing out in a commodity category – interestingly from the case studies I see two slants on this – Method (household cleaners – available at Target) is an example of a company that used their sustainability plus sexy branding to stand out from a commodity category and be visible to the customer. They used brand identity to create a premium product, so they could command a premium price, so they could be environmental without making their environmentalism their primary selling point. This way they could reach out to mass market instead of just the environmental niche. Coastwide Labs, making cleaners for commercial janitorial settings, is an example of an environmental product that stands out from a commodity market, but it seems slightly reversed in that they designed to be an environmental product and their sales are driven by customer demand (one example: municipalities passing Precautionary Principle purchasing ordinances), thus allowing them to command a premium. So in one case, they’re using sexy branding to drive demand to pay for sustainability, in the latter case demand is driving sales and allowing them to command a premium for sustainability. I wonder what their relative volumes and margins are, I’d guess Method is higher volume/lower margin than Coastwide, compensating for age of the company. EcoWorx carpeting is described as breaking out in a commodity category, but their case is almost one of being forced to play catch up when a competitor (Interface) takes a successful lead with sustainable product, as well as being driven from behind by the kinds of industry voluntary agreements that form to avoid regulation.

Goal Setting – Shaw Industries, makers of EcoWorx, is an example of setting a goal to become infinitely recyclable and getting there because of the set objective, though it took them many years and almost a million dollars in research. The Coastwide labs example is a particularly good one – they lowered costs overall not by making the product itself (cleaning solutions) cheaper as they made it less toxic, but by making the packaging cheaper & the dispensing more efficient. Those two improvements were most likely available to them independent of making the product environmentally friendly. Business is all about priorities, and those priorities stayed low on the list until the goal of making environmentally friendly products raised the need for lowering costs which raised the priority of those cost reduction options. It was the setting of the goal that made the difference. NatureWorks PLA is another product that was created by first setting a goal to create it.
Nike has also set long term goals and developed metrics that lead them to explore all areas of their product supply chain and internal corporate operations.

The whole lifecycle – Method standing out in their commodity category with sexy packaging, Coastwide cutting packing costs as part of cutting overall costs to support their price point – both are examples of how the packaging is just as important as the product in forming the whole proposition. The textile examples of EcoWorx and Climatex are cases where the end-of-life for the product was a key part of the proposition, and the supply chain examples show how the pre-life of the product is a key part. When going sustainable, taking a total lifecycle approach is essential.